An Old Beer Learns New Tricks, and Risks an Identity Crisis

CHIPPEWA FALLS, Wis. — Craig Long set his beer on the counter of the bratwurst stand while he showed off an iPhone photo of a deer he’d shot last fall. It was the start of a two-night festival in August to celebrate the 150th anniversary of the Jacob Leinenkugel Brewing Company. Mr. Long, 67, of Kewaunee, Wis., was enjoying a Märzen-style lager, brewed for the occasion with just four ingredients — barley, hops, yeast and water — in accordance with a 500-year-old Bavarian beer-purity law.

Mr. Long puckered his face at his buddy’s sweetened brew, then conceded that any fan of Leinie’s, as Wisconsinites know the beer, was a member of a tribe.

“It’s a cult thing,” he said, raising his plastic cup.

Leinenkugel’s and its parent company, MillerCoors, would like to make the brand more than just a cult or local favorite. And they have largely succeeded with Summer Shandy, a breakout hit released in 2007 that has inspired a whole line of flavor-enhanced brews — watermelon, pomegranate, cocoa-raspberry — and, for the first time, brought the country’s seventh-oldest brewery to taps and store shelves nationwide.

But with success has come the kind of identity crisis that faces many midsize regional brewers as they jostle for market share with ascendant microbreweries and shelf-hogging megabrands: How to expand their appeal without losing their patina of authenticity?

Leinenkugel’s, now known around the country for its fruity shandies, owes its home-turf reputation to a slate of unfussy heritage lagers that Wisconsinites have long enjoyed at corner taverns and fish fries. When the Miller Brewing Company bought the brewery in 1988, some 90 percent of its production was dedicated to its flagship beer, known today as Leinenkugel’s Original (“Leinie’s O” to the faithful), a crisp German lager brewed from the 1867 recipe of its patriarch, Jacob Leinenkugel.

The buyout initially ruffled feathers here, but the Milwaukee-based Miller won over all but the most purist drinkers by keeping production in this small town and retaining the Leinenkugel family to manage the brand — an unusual approach at the time. Now headed by Dick Leinenkugel, the founder’s great-great-grandson, the brewery still enjoys a reputation around Wisconsin as a scrappy family enterprise, even though some of the beer is brewed in Milwaukee.

Miller’s early efforts to sell Leinie’s O on the East and West Coasts fizzled. So the company embraced variety as a means of wooing new drinkers in the Upper Midwest, devoting more and more effort to a motley parade of new labels, limited releases and seasonal brews.

Today, many breweries have embraced a similar model of quasi-independent corporate partnership and persistent novelty.

More than a dozen prominent midsize brewers have risked their credibility with the craft-beer crowd in recent years by expanding distribution via corporate investment or a buyout. An early example was Goose Island Beer Co., a Chicago brewery acquired by Anheuser-Busch InBev in 2011. Goose Island’s founder, John Hall, said he regarded the Miller-Leinenkugel’s deal as a template for how he wanted his brewery treated.

What’s more, the cachet of flagship beers like Leinie’s O has dwindled as drinkers seek the new and unfamiliar in a crowded market. That has especially hurt well-established regional breweries, said Paul Gatza, director of the Brewers Association, which last year reported slumping sales for 15 of the country’s 25 largest craft brewers, like Sierra Nevada, Harpoon and the Boston Beer Company, which makes Samuel Adams beers.

To stave off “flagship fatigue,” some breweries are charging at a breakneck pace beyond the beers that once defined them, said Chris Furnari, editor of the industry website Brewbound. “One-offs, seasonals, line extensions — everything’s going crazy,” Mr. Furnari said. “Consumers right now, they just want to try new things all the time.”

Summer Shandy is Leinenkugel’s first national success. The style is a take on a radler, a traditional German mixture of beer and citrus juice or soda, originally created to sate thirsty cyclists. (Radler is German for cyclist.) While some craft beers incorporate fruit into the brewing process, Leinenkugel’s shandies are the products of extracts and sweeteners added to a finished brew.

Encouraged by regional demand, MillerCoors pushed Summer Shandy nationally in 2010 as a summer seasonal release. By the summer of 2012, according to data from IRI, a Chicago market research firm, it was outselling all but three craft competitors in supermarkets.

A dozen new Leinenkugel’s shandy varieties followed (as did copycat shandy brands), and the line now accounts for nearly 70 percent of the brewer’s production. Leinenkugel’s is now the country’s fifth-best-selling craft beer brand, according to IRI.

But for some longtime drinkers, including many among the 11,000 who gathered in Chippewa Falls for the anniversary party, watching trendy shandies eclipse the workingman’s beers their grandparents once enjoyed is disorienting. During a question-and-answer session with the company’s brewmasters, one wistful Leinie’s drinker shouted, “When are you going to brew some beer that tastes like beer?”

Andy McGrane, a 47-year-old Chippewa Falls resident dressed for the weekend in lederhosen, described the shandy drinkers and fans of his favorite style, Leinenkugel’s Red Lager, as “totally different groups.”

“I had no idea what was going on with Summer Shandy in these other states until friends from Tampa told me it was their favorite,” he said.

That schism weighs on the mind of C.J. Leinenkugel, 34, an account executive in the Pacific Northwest who, with his three siblings and a cousin, is among the sixth generation to work for his family’s brewery.

“We’re the shandy people to some folks now,” he said, after posing for a family photo with about 90 members of the Leinenkugel clan. “It does, in a sense, kind of bum you out because we do brew so many other beers,” he said. “The beer that put a roof over my head was Leinie’s O.”

In August, MillerCoors released Leinenkugel’s Original nationwide for the first time, part of a fall sampler pack of Leinie’s classic brews. Dick Leinenkugel hopes to more than double total production to two million barrels by 2020. And with light-bodied German beers enjoying a resurgence, he sees an opportunity to attract new drinkers to the clean, malty lagers beloved in Wisconsin — particularly the 35 percent of shandy drinkers who, company research suggests, didn’t previously drink beer.

It won’t be easy. “That’s a tall order,” said Ryan Schmiege, assistant brewmaster at the 29-year-old Deschutes Brewery in Oregon and a Wisconsin native. “Shandies are the soda of beer. They’re fun, but I wonder whether they’ll really convince people to try the old stuff.”

All the same, he’s glad he can finally buy Leinie’s old brew far from his home state.

“It’s like cheese curds or the Packers,” Mr. Schmiege said. “It’s fun, it’s nostalgic, it’s Wisconsin. Even though it’s bigger than that now.”